Cataclysm and Change on Wall Street

The lead article in today’s New York Times is titled, “A Year After a Cataclysm, Little Change on Wall St.” It describes the current situation in the financial industry, where little has changed since last year’s chaos and bailouts. Exorbitant salaries are still the rule rather than the exception; banks are still trading in derivatives; and there is little to no action in terms of increased regulation.

According to the article, another collapse is not out of the question. Even though banks are lending less, that posture is typical during a recession. A chart of proposals on financial regulation shows that only credit card reform and limitations on short selling of stocks has passed. Other legislation on foreclosures, mortgages, derivatives and executive compensation are languishing in Congress.

In my opinion, this state of affairs is deplorable. After suffering through the brink of a worldwide financial collapse, we need to take action to reform the system. Status quo ante is not a workable solution.

Of course, financial companies contribute heavily to political campaigns; hire the best possible lobbyists; and unabashedly protect their  prerogatives. Only a concerted effort, and an outcry by the American people, can force our representatives to act.

As long as the chart of failure stays buried in the middle of The New York Times, we will be beholden to the whims and risks assumed by financial organizations.